Uncommon bills will lose legal tender status in 2021. Is your collection worthless?

WATCH: Uncommon Canadian bank notes to lose legal tender status in 2021

When the clock officially rolls over into 2021, tens of millions of old Canadian bills will lose their legal tender status, meaning they technically can’t be used in transactions.

But that doesn’t mean they’re worthless.

The Bank of Canada (BoC) issued a reminder this week that the change will affect the $1, $2, $25, $500, and $1,000 notes, which haven’t been produced in decades, and are typically not used in transactions, unless of course they’re being bought or sold by collectors.

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“The bank will only give you face value for these bills,” says Allen Knapp, owner of Provincial Stamp and Coin in Winnipeg, adding that’s likely not reflective of the bill’s worth in the eyes of collectors, who use a “catalogue value.”

So, what should you do after you break open grandpa’s safe and find a crisp $1,000 bill?

In an email, a spokesperson for the BoC says the simplest thing is to bring the bill to your bank and have it exchanged for legal currency, or you can send it to the BoC to have its value redeemed.

Or, you could always just keep it.

“The worst thing they can do is take them to the bank and get face value for them,” Knapp says.

“They should probably take them to a coin dealer they trust and get an idea what they’re worth and then they can decide what they want to do … maybe keep them in the family, or sell them and take the money.”

How much money are we talking?

By far, the rarest and arguably most valuable of the soon-to-be-defunct currency is the $500 note, which Knapp says catalogues at $50,000 in very good condition.

However, its value at an auction is likely well above that.

Sadly, your odds of ever being handed one by chance are slim to none.

It was a commemorative note released only in 1935; the BoC says there were only 40 left in circulation at the end of 2019.

The $25 note was also a commemorative bill issued in 1935 and discontinued shortly thereafter. There are 1,840 in circulation.

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Knapp says he’s handled about a dozen of the $25 notes over the years, never a $500, and despite the face value, $1,000s are relatively common.

“I have a couple of those here right now, and even a brand new $1,000 bill from the 70s is only worth about $1,200 or $1,300,” Knapp says, adding he receives a call almost every week from people wondering how much they’re worth.

“I tell them if they’re damaged in any way; crumpled, wrinkled, written on, just take them to the bank and get your money.”

BoC data shows there are about 632,000 $1,000 bills in circulation.

Meanwhile, there are well over 100 million of both the $1 and $2 notes left, which were replaced with coins in 1987 and 1996 respectively.

As for why they’re losing their legal status, the BoC says they’re simply not very common and aren’t being used in transactions.

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“Withdrawing legal tender status from these notes is the final step in fully removing them as transaction notes in Canada,” a BoC spokesperson writes.

“It is important for Canadians to understand that these notes will not lose their value; the Bank of Canada will continue to honour them.”

There are no plans right now to issue any more commemorative notes like those from ’35, the spokesperson writes, but the BoC is in the process of redesigning the existing $5 bill.

An independent advisory board has shortlisted eight candidates who might replace former Prime Minister Sir Wilfrid Laurier as the face of Canada’s $5 bill.

© 2020 Global News, a division of Corus Entertainment Inc.

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